DEFINITIONS

The following definitions are used for terms necessary to fill out the survey form.
Collection Effectiveness Index (CEI)
Use beginning quarterly A/R and end of quarter A/R
CEI = beginning total receivables + (quarterly credit sales/3) - ending total receivables         x 100
          beginning total receivables + (quarterly credit sales/3) - ending current receivables 
Example: $12,327,157 + ($47,881,064/3) - $13,663,598     x 100 = 71.54
              $12,327,157 + ($47,881,064/3) - $7,846,547
 
Days Sales Outstanding (DSO)
DSO = Last three month ending total receivable balance     x 30
                            Credit Sales for Quarter
 
Example: $16,935,357 + $17,936,658 + $13,663,598 x 30 = 30.41
                    $47,881,064
 
Best Possible DSO
BPDSO = Last three month ending current receivable balance     x 30
                            Credit Sales for Quarter
 
Example: $8,398,365 + $7,698,687 + $7,846,547 x 30 = 15.00
                    $47,881,064
 
Percent of Trade Receivables over 91 Days Past Due
Percent over 91 days past due = Average Receivables over 91 days
                                                    Average Total Receivables
 
Standard Industrial Classification (SIC) Code
A 4-digit code developed by the Office of Management and Budget of the Executive Office of the President
to define industries in accordance with the composition and structure of the economy. If your company has one or
more than one SIC code and you do not have separate receivable statistics, please complete SECTION 1.
If separate receivable statistics are maintained for individual business divisions, complete a separate calculation for
each SIC code using SECTION 2.
 
Credit Sales: Actual billings include freight, taxes and containers; not the sales shown in
the accounting records where such items are excluded.
 
Total Trade Receivables: All domestic open invoices and notes receivable, deferred billings or datings, past-due billings, credits, unapplied cash, suspense accounts, charge backs, invoice deductions, ankruptcies, claims, disputes, litigation and accounts placed for collections. (If items such as bankruptcies and claims have already been written off to bad debt, do not add them back into the AR for this data). Companies with leasing arrangements should report only the portion of those leases that have been billed.
 
Average Trade Receivables Beyond 90 Days: Monthly average of trade receivables 90
days or more past due (Aged on actual due date).